As we step further into 2024, the insurance industry stands at a pivotal crossroads. The recent Insurtech Insights 2024 event in New York City served as a powerful reminder that innovation, driven by cutting-edge technologies, is not just a future possibility but a present reality.
The conference gathered the brightest minds and most forward-thinking companies in the industry and highlighted numerous burgeoning trends and innovations that promise to revolutionize how insurance operates.
This blog post delves into the latest insurtech trends that are reshaping the landscape, offering insights and practical advice for insurance industry leaders as they forge ahead.
Major Discussions from Insurtech Insights 2024
Day one of the Insurtech Insights conference was dominated by discussions around Artificial Intelligence (AI). Here are some of the key takeaways:
- Generative AI Use Cases: While current use cases for generative AI in insurance are limited at insurance companies, the potential impact on capital allocation, underwriting efficiency, and claims adjustment is substantial.
- Investment Growth in AI: Q1’24 saw AI-related firms and technologies attract $325 million in investments, according to one panelist, indicating robust momentum and a growing belief in AI’s capabilities.
- AI as a Complement, Not a Replacement: AI isn’t expected to take over the entire insurance industry. Instead, it should be viewed as a tool among many. Insurance professionals who may be intimidated by AI should understand that the real threat lies in professionals who leverage AI more effectively than others.
Day two covered a range of topics, but it was one panel on the emerging Gen Z market that resonated with me the most as it confirmed many of the insights from the Comperemedia 2024 Insurance Trend GenY&Z. A few highlights included:
- Gen Z Expectations: This generation expects high levels of personalization, convenience, and customer service in their insurance experiences, akin to other industries. Insurers will need to meet those needs if they want to attract the next generations of customers.
- Financial Concerns: Gen Z is often anxious about their financial future, seeking advice through social media and influencers. Insurers must present themselves as partners that can help customers protect and plan for the future.
- Digital Presence: Being the first fully digital generation, Gen Z values digital engagement and expects brands to communicate in their language. Whether through leveraging digital acquisition channels or iterating on digital capabilities, insurers must press forward in digital innovation if they want to appeal to this demographic.
Bringing It All Together: The Path Forward
In my Q1 Insurtech Tactical Board, I spoke about a brighter future for many insurtechs who were at or nearing profitability. To stay ahead of the curve, insurtechs and incumbents alike must take practical steps to integrate these trends into their operations. Some key actions will include:
- Be disciplined, be accurate: This may not come as a surprise, but the basic tenets of successful insurance operations remain. Disciplined underwriting, accurate pricing, and clear paths toward profitability remain mainstays, perhaps more going forward than ever before.
- Conquer Distribution: Acquiring customers can be difficult in insurance, where the biggest players spend billions per year in advertising and most work through local agents. This will continue to be a major implication of success and insurtech brands must find their niche to acquire the right customers and grow profitably.
- Leverage AI for Competitive Advantage: The next wave of insurance innovation will be centered on leveraging Generative AI effectively and responsibly. Brands should be focused on areas where AI can deliver the most value, such as underwriting efficiencies, claims processing, and customer management.
- Drive GenZ engagement: Insurtechs have a unique appeal to GenZers who are the first digitally native generation. Brands should utilize AI to create personalized marketing campaigns that resonate with Gen Z’s values and preferences, while also staying present on social media channels and leveraging influencers to connect with young consumers.
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